Vale: Careful What You Wish For

Looks like Brazilian miner Vale SA will make it to Hong Kong by the end of the year after all, but the timing could be better.

Dow Jones Newswires reports that the Hong Kong stock exchange approved Vale’s listing of depositary receipts, which would allow the company to start trading here by December.

AFP/Getty Images

Vale’s Goro nickel project in Nova Caledonia, Brazil

Vale and the folks working on its listing had been eagerly hoping to get the stock trading in Hong Kong before the traditional holiday season slowdown. Thursday’s approval just barely managed to achieve that goal. However, Vale will have a tough time avoiding a general cooling of investor sentiment in Hong Kong.

Concerns have been rising over inflation and monetary tightening in China, as well as recently announced policies to cool the local residential property market that have dragged down property stocks and the broader Hang Seng Index. Trading volume has thinned, while a series of initial public offerings have either been postponed or underperformed on their debuts.

By contrast, Brazil’s Bovespa and other Latin American exchanges hit record highs for annual trading volume this week, suggesting that the region may be more insulated from economic woes elsewhere. But a Hong Kong listing would ultimately allow Vale shares to be traded around the clock.

Add a Comment

About Exchange

Exchange is The Wall Street Journal’s place for inside news, insight and ideas on Hong Kong’s business and finance community. Write to us at hongkong@wsj.com or follow Exchange on Twitter and Facebook.